NZ: Doubt on whether the RBNZ could cut rates - TDS

Research Team at TDS, notes that the RBNZ Speech advisory said that the Dep Gov Grant Spencer will speak on Macroprudential policy and housing market risk at 5.30pm NZ time on Thursday 7th July. 

Key Quotes

“Should the RBNZ announce that the new rules have been set, this should help open the door for potential RBNZ cut(s).

To add some doubt on whether the RBNZ could cut rates,  Finance Minister Bill English said he was concerned about the rise in the New Zealand dollar on Tuesday to a 14-month high of over 77 on the Trade Weighted Index, but said that the Reserve Bank appeared unlikely to be able to do much about it because the traditional linkages between the Official Cash Rate and the currency had broken down.

House price inflation picked up yet again, QV announcing house prices rose 13.5% in the year to June, up for the 3rd straight month, from 12.4% in May. Auckland prices were up 16.1%/yr (from 15.4% in May), with prices +4.7% in just the past 3 months. Buyer classification data shows 46% of Auckland sales were to investors.

June Commodity prices rose by the most in 8 months, +3.7%/m but still down 5.4%/y. IN NZD terms, prioes rose 0.3%/m but fell 5.9%/yr. The rise is a positive result but no cause for celebration.”